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NVIDIA countersues Intel for contract breach

updated 09:00 am EDT, Fri March 27, 2009

NVIDIA Countersues Intel

NVIDIA late Thursday filed a countersuit (PDF) against Intel, accusing the semiconductor firm of a breach of contract. The response follows Intel's earlier formal complaint and accuses Intel of violating a 2004 license for NVIDIA by denying it the rights to build mainboard chipsets for Intel processors that use integrated memory controllers, which includes any Core i7 chip as well as newer Xeon chips like the 3500 and 5500 series. NVIDIA is currently only being allowed to engineer for processors no more advanced than Core 2.

Company chief Jen-Hsun Huang claims that Intel is being one-sided by blocking rights to its technology portfolio while simultaneously maintaining its own access to NVIDIA's patents. "Intel's actions are intended to block us from making use of the very license rights that they agreed to provide," he says.

Intel has so far maintained that the license only extends to discrete memory controllers and that any continued permission would have to come through a renegotiated license that includes the newer technology.

NVIDIA, however, has publicly charged that Intel is consciously misinterpreting the license as a means of artificially propping up its mainboard business and punishing a competitor for a better product. Its hybrid system and graphics chipsets, like the GeForce 9400M, are known to significantly outperform Intel's own integrated graphics and are being used to provide HD playback and more advanced 3D on netbooks and other systems that otherwise would be incapable of handling the content.

Intel hasn't formally responded to NVIDIA's lawsuit.

A sustained fallout between the two potentially has severe repercussions for the PC industry. While any system based on all of Intel's existing notebook- or netbook-class technology can legally use an NVIDIA platform, Intel's fastest desktops would now be out of bounds for PC builders; those hoping to build notebooks based on future Core i7 and system-on-chip Atom processors will also have to revert to Intel's own platform or an alternative. Companies like Apple are now heavily dependent on NVIDIA's platform and may be forced to rearchitect most of their systems if the dispute isn't resolved in time for future updates.

by MacNN Staff



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